Andy Burnham, the Mayor of Greater Manchester, has approved a new holiday tax that could be rolled out across England within two years. The Prime Minister has given regional mayors the power to impose an unlimited "overnight visitor levy" on stays in hotels, bed and breakfasts and holiday lets across England.
But not everyone is convinced the move will help. Hotel bosses and tourism workers have pointed to Europe, where similar levies have raised money for local infrastructure but show little evidence of easing the pressures they were meant to solve, according to the Guardian.
Europe's mixed record on tourism taxes
In Venice, a trial day-tripper fee was in place for part of this summer, yet the city still saw huge numbers of visitors and even demonstrations against overtourism.
In Spain, travellers aged 16 and over are expected to pay a varying local rate plus 10 per cent VAT when visiting Mallorca, Menorca, Formentera and Ibiza. Despite this, the Spanish hotspots have still grappled with huge visitor numbers and anti-tourism protests this summer.
Barcelona has gone further still. Tourists there now face nightly fees of up to 15 euros, around £13, after a significant increase in the local tourist tax, making it one of the highest such charges in Europe. Yet the effect has been "all cosmetic", according to Daniel Pardo Rivacoba, who works for the Neighbourhood Assembly for Tourism Degrowth in Barcelona, speaking to The European Correspondent.
Hotel and B&B owners react
Hotel bosses and tourism workers in England are particularly unimpressed with the new levy. Anthony Duffey, owner of Sunnyside Bed and Breakfast in Southport, told the Daily Mail: "The proposed visitor levy feels like another burden at a time when many small businesses are already finding things tough."
He said: "Many B&Bs have only recently had to deal with Making Tax Digital, bringing additional administration and costs, and now we may have another tax to collect and account for. Many small businesses in seaside towns are at breaking point."
Duffey pointed to figures from the latest full-year Great Britain Tourism Survey, which show that domestic overnight trips to the seaside and coast in England fell by 18 per cent in 2025 compared with 2024. "That, coupled with rising energy, insurance and food, makes it difficult to run your business," he said. "The addition of another tax on the horizon is a cause for concern. The current government made promises to cut red tape and tax billionaires before coming into power, yet this feels like the complete opposite."
Duffey argued the levy "also strengthens people's cases for holidaying abroad over staying in the UK."
He added: "Many small guest houses are already operating under significant financial pressure. Adding another tax and another layer of administration could push some businesses over the edge, resulting in owners losing businesses they have spent years building and people losing their livelihoods."
Industry bodies warn of competitiveness risk
Concerns have also come from official travel bodies. The Business Travel Association, beam, which represents the business meetings, accommodation and events sector, and the Meetings Industry Association issued a joint statement responding to the government's announcement of a nationwide overnight visitor levy framework.
"This is a short-sighted move that risks making Britain's cities less competitive at exactly the moment we should be doing everything we can to attract investment, events and business," the statement said. "The real question isn't whether a tourist tax is a good or bad idea, but whether it will actually benefit the destinations and businesses being asked to pay it."
The statement acknowledged that tourist taxes are widely used across Europe and, if the revenue is reinvested, can fund infrastructure and services that support the visitor economy. But it warned of a bigger risk: "If every region is left to decide its own approach, a patchwork of different charges and rules could make it harder for businesses to operate and leave the UK looking disjointed to international markets. We should be competing with other countries, not creating a situation where UK destinations are competing with each other on tax."
The bodies said that if local authorities are handed these powers, there needs to be a clear commitment that tourism is a priority, with transparency over how the revenue is reinvested and a consistent approach across the UK. "Tourist tax can have a role to play if it is used as part of a reinvestment cycle to make destinations more attractive," the statement continued. "But if it simply adds another business cost, the biggest risk is that it makes the UK less competitive at a time when we need to be doing everything we can to strengthen it."
'A total slap in the face'
Giles Fuchs, custodian of the Burgh Island Hotel in Devon, summed up the industry's frustration. "To say that the message from the government is mixed would be the understatement of the year," he said.
"For Burnham to say he understands the plight of the hospitality industry and reduce the increase in business rates by a fraction, which presumably showed he understood, to then immediately hit the industry with a further cost that will either stop clients coming or, more likely, be absorbed by the industry is a total slap in the face."
